Korea Post seeks equity managers, alternatives adviser

The insurance arm of the $70 billion government-linked organisation is requesting proposals related to managing global equities and advising on alternatives.

Korea Post’s insurance bureau is requesting proposals from fund managers with regard to active strategies for developed and emerging market equity.

It is also looking for an adviser for alternative strategies, including private equity, commodities and real estate (both direct and via funds).

Applicants for the alternatives advisory work must submit pitches by today, November 29, and for the equity pitches by December 3. They must be in Korean, and the equity proposals must be GIPS-compliant.

The alternatives adviser will provide global alternative investment industry analysis and forecasts, as well as follow-up advisory analysis and recommendations on Korea Post’s alternative investments. Application forms shall be submitted to both the postal insurance bureau and to KBP, a local fund-rating company.

Korea Post has two financial service bureaus -- postal savings and postal insurance -- both under the management of the Ministry of Knowledge Economy. Postal savings manages around $44 billion and insurance $26 billion. Their AUM has been rising quickly in US dollar terms.

In a previous interview with AsianInvestor, Korea Post’s Jurng Chul-joong, CIO of postal insurance, said the postal assets are sometimes invested along with those of insurance. He said his priorities for the year were to come up with an international investment strategy and to double or triple alternative exposures (see AsianInvestor magazine, October 2010).

According to a source at the organisation, domestic and foreign asset managers pitching for the active equity strategies must have at least three years of experience as of June 30, 2010, in active equity fund management and the minimum asset size of the related strategy must be at least W200 billion ($175 million). Fund-of-equity-fund managers need not apply.

Korea Post prefers segregated accounts but will consider commingled products. A source at the organisation says it's likely to appoint two managers for developed-market mandates, and another two managers for emerging-market equities.

It also disclosed that Hana Daetoo Securities and MiraeAsset Global Investments (both based in Seoul, Korea) have been selected as the respective onshore advisory investment firms. They will handle the evaluation process, currency hedging, monitoring, etc, as well as all operations-related tasks. They will also help Korea Post vet the proposals for international equities.

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